SMOKING OUT
CHEATING EMPLOYERS
by Tom Robbins
New York Daily News
As they understood their marching orders, it was the job of the two inspectors from the carpenters union to catch crooked contractors.
When they walked onto the construction project at a public school on Moshulu Parkway in the Bronx last February, Mike Livingston and John Lesica were looking for employers who cheat by paying workers off the books, in cash and/or less than the required rate on public sector jobs.
Such contractors cheat the people of New York several ways.
They pocket money that they had promised to use for wages when they won bids to do government work, like building schools. They also bilk the workers of the higher pay they are entitled to receive.
In addition, they victimize unions, like the carpenters, that rely on honest contractors to make benefit fund contributions for their members.
Law enforcement officials and construction union leaders say such cheating is rampant in the city, which is why the carpenters union decided to use its Labor-Management Cooperation Trust Fund to smoke out violators.
The decision was a strategic self-defense move by the union to find corrupt builders. It was also symbolic. Prior union President Fred Devine had used Labor-Management as a slush fund and was convicted of misusing hundreds of thousands of dollars from it.
The union, now under national trusteeship, turned to a veteran federal labor and drug enforcement investigator, Harvey Tuerack. He hired another ex-drug enforcement investigator, Edward Magnuson, who had arrested John Gotti in 1985.
They recruited a crew of aggressive young carpenters, including Livingston and Lesica, to tackle the problem of prevailing wage violations on city construction projects.
What the Labor-Management crew quickly found was that other union representatives were apparently turning a blind eye to the kind of cheating they were hired to prevent.
Such was the case at the school on Moshulu Parkway. The contractor, Luna Carpentry, told Livingston and Lesica that other carpenters union officials had already been there.
Despite the assurance, the inspectors found workers making substandard wages. Several employees, who claimed to be union members, gave them false names and phony Social Security numbers.
Disturbed by their findings, the inspectors called William Keating, another carpenters union official.
Keating took the call on his cell phone while driving with Frank Schiavone, the carpenters union business representative in charge of the Bronx.
Schiavone quickly snatched the phone away, said Keating.
"What the f--k is Labor-Management doing on my job?" Schiavone demanded, according to Keating. "Who told you to go there? I'll break your f-----g legs. I'll have you . . .killed," he screamed.
Livingston and Lesica took the threat seriously, reporting it to other union officials.
Schiavone didn't mean it, they were told by top District Council officials. They were asked to sign a letter saying that Schiavone didn't intend his threat to be taken "literally."
The inspectors refused to sign the letter. The confrontation proved a turning point at the District Council of Carpenters. Soon after the incident, Labor-Management inspectors were ordered to steer clear of any jobs with union contractors, even ones with reported wage violations.
Last week, the District Council cleaned house in the Labor-Management fund. It fired 10 employees, including Tuerack, Magnuson, Livingston and Lesica. All declined to discuss their firings.
District Council spokesman Richard Esposito said the move represented a "restructuring." "It has not been a good use of the resource for us," he said.
Henceforth, said Esposito, the fund will shift from law enforcement to information gathering.
The incident with Schiavone "would be considered serious if it occurred," he said. Schiavone could not be reached for comment.
E-mail: trobbins@edit.nydailynews.com
Original Publication Date: 07/19/1999
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